What is the Business of HR?

Have you noticed? HR is making headlines!

gauge_custom_red_15312 3We’re in Fast Company, Forbes and Harvard Business Review. We’re in dozens of business books hitting the market, providing competency models, new analytical tools, and metrics that will help us to gain the credibility we would like to have.

We are all over LinkedIn, in groups, in discussion threads and in “The Pulse.” Prominent business thinkers like Ram Charan are opining on the profession, and suggesting how it can be “fixed.”

One of the best (in my opinion at least) online publications about HR calls itself “tlnt.com: the business of HR” with a focus on the huge amount of knowledge required in the Human Resources profession.

But what is the business of HR? Unfortunately, those articles and books are not terribly complimentary about the work of HR, and many propose that the answer is to increase to HR’s business acumen.

I was speaking with an HR friend recently who serves as an HR partner to a line of business in a large manufacturing organization. In a business meeting, she chimed into the conversation about which other companies might be good acquisition targets with a thoughtful and knowledgeable analysis of the options. Those business people at the table had to pick their chins up off the table. Why? They didn’t expect someone from HR to know anything about the business. She showed them – you go, girl!

But is the business of HR knowing the business? Partly. HR needs to understand the financial, operational, marketing and other business levers of their organization and industry in order to have the credibility to influence operational leaders.

Is that enough? What if I suggested that “the business of HR” is the business of serving its customers? Would that shift the paradigm of HR from being an overhead department to serving a real and necessary purpose in the organization?

I think it would.

As an overhead department we think about what has to be done. As a business provider, we focus on what the customer needs and wants or our services won’t be continued (or we’ll create a lot of grumbling customers who have no option because they are stuck with us.) There is a subtle but important distinction here. What would it look like to approach HR as if we were selling (and re-selling) our services to our customers?

We would know who are customers are,

We would research our customers’ needs and wants,

We would have a strong, cohesive and solid marketing plan,

We would educate our customers on our area of expertise,

We would involve our customers in developing our products and services, and seek their feedback,

We would understand how much it costs for us to produce our products and services, and build an equation to ensure that the value exceeds the cost,

We would continuously evaluate our levels of service to ensure their satisfaction,

We would not tolerate shoddy service or inaccurate business intelligence; we would take immediate steps to fix the problem and let the customer know.

How is this different?

Well, I sense that we are not always sure who our customer are. More importantly, however, we tell our customers what they must do and then hope they will do it. We build programs that are cumbersome and often seen as a waste of time, and perpetuate these programs over and over. We are constantly challenged to reduce expenses because our customers do not understand the equation of cost to value, or worse – they don’t see the value.

Is this a harsh indictment of my own profession? Perhaps it is.

I challenge you though to think carefully about these customer focused statements, and place a mirror up against your own HR team. Do you know your customers, your costs, your value and your customer satisfaction? You should.

When we think about the business of HR, let’s broaden that focus to include creating an intentional, well-conceived business plan for the products and services we provide to our customers. I suspect that, if we do this right, it will measurably improve our credibility.

I would love to hear your thoughts on this concept.

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